Hawaii's Deferred Senate Bill 2089 Resurrected in House Bill 2078

Kauai, photo by KJ Konkin

Hawaii's Senate Tourism Committee debated HB2078 on Thursday March 22, 2012 and amended it to include the highly controversial language of SB2089, a bill which had been deferred and effectively neutralized March 12. The legislation requiring vacation rental owners to hire professional property managers to pay their taxes for them has found new life in HB2078, and will now move to the Consumer Protection Committee for possible enactment July 1, 2012.

Vacation Rentals By Owner in Hawaii

HB2078 initially focused on requiring vacation rental owners to have their ads, including website ads, display their Tax number  and the name of an on-site contact. The State's goal is to protect consumers, however, they could solve the problem more simply by requiring owners to post the name and phone number of their designated local contact inside the property and on rental documents.

The real danger inherent in the bill is that anyone viewing an internet ad divulging a property owner's registration number can then obtain his personal contact information from the public Tax Department License Checking page, also easily available through the internet. This poses a serious risk to the vacation rental business owner for identity theft, burglary and/or vandalism. Since the owner is off-island, properties can be cased and then robbed when vacant. Registration numbers may also be used fraudulently by other establishments that are not licensed. Forty-three percent of Hawaii's housing involve rentals.

Rental By Owner Awareness Association

Property owners and visitors to Hawaii need to be aware of a serious effort among some real estate property managers to insert themselves between visitors to the islands and the proprietors of transient vacation rental homes, to manage their bookings and pay their taxes while charging a thirty to forty percent commission. However, many vacation rental businesses prefer to manage their operations themselves and do not need or want to use real estate professionals. All owners must have on-site help to successfully manage their vacation rentals, but their staffs may be housekeepers, repairmen, or just trusted neighbors or family members.

Kaneohe, photo by Jason Gomez

Groups like KIK, SON and The BnB Coalition also oppose any new laws that would help the vacation rental industry. The BnB Coalition states on their website that "over the past few years, a rash of illegal B&B's and TVU's have sprung up in Oahu's residential neighborhoods. They are an unwelcome and destabilizing influence in our otherwise desirable suburban areas." However, these groups hold a minority viewpoint. Overwhelming testimony on the State Legislature's website supports the rights of property owners to conduct business and the need to update laws concerning the permit process that has been stagnant since 1989.

The anti-tourist sentiment of a few locals continues to bubble up in new bills, but a grass roots organization, Rental By Owner Awareness Association (RBOAA), has sprouted, composed of property owners who live off island. Membership fees are used to hire attorneys, lobbyists, public relations and office personnel. The organization aims to monitor proposed legislation, foster communications among property owners and educate the residents of the State of Hawaii and government officials about their industry.

  

The leaders of Hawaii have apparently mobilized a sleeping giant. RBOAA will unite individuals around the globe who love the islands as much as locals do, ensuring their voice is heard.

Sources:

www.rboaa.org/

www.capitol.hawaii.gov/

Read more:

• Governor Abercrombie Undecided About HB 2078
• Hawaii State Legislature Passes HB 2078
• Best Place to Own a Second Home in Hawaii

Local Church Gives Cars, Computers and Groceries to Needy Families

Pastor Ryan Kwon

Resonate Church turned two-years-old March 18, 2012 and decided to throw itself a party. Over 600 people came to the birthday bash Sunday morning at the Fremont Adult School in Fremont, California, the church's current location. Children frolicked in a giant jump house set up in the parking lot while Chef Brad Fuellenbach and his ministry team served breakfast and a lunch of homemade tacos. Fuellenbach is frequently seen cooking for worthy causes, from barbeques to banquets to private parties, and Resonate is grateful for his willingness to serve.

photos by Christine Szeto and Steven Davis

Resonate Church in Fremont, California

To further celebrate the milestone, the staff of Resonate wanted to help needy families in the community above and beyond the norm. The mission of Resonate Church is to be of service to its surrounding neighborhoods, showing the love of Christ in tangible ways. The organization calls itself a "church for the city" and hopes to reach unchurched and de-churched people with the redemption of Jesus Christ.

For two weeks the Spirit moved among Christian people, spurring a generosity that enabled the staff to accomplish their goal. Resources were donated by people inside and outside the church's fellowship to provide computers, iPods, groceries and five previously owned but very nice vehicles. Church members nominated individuals they personally knew to receive the items, and the giveaway occurred during both morning services.

Scott Taylor, Worship Pastor

One recipient was a single woman who had experienced a crisis pregnancy in 2011. Faced with difficult choices, she ultimately chose life for her child. She commutes to work on public transit, and her life has been more challenging with a baby in tow, but she doesn't regret her decision. She was grateful to learn that a person she didn't know wanted to give her an Acura worth $13,000.

Another couple was struggling because the father, the family breadwinner, had recently undergone brain surgery that was unsuccessful. His wife said she needed money to buy rice and beans, but Resonate was able to do more, due to the outpouring of donors. The couple was very happy to receive a $1,000 gift certificate for groceries. The day proved to be the biggest event so far in Resonate Church's brief history, but the body of believers expect their future to be even more blessed. The church meets every Sunday at 9:00 and 110:00 a.m. at the Fremont Adult School, 4700 Calaveras Avenue, in the Irvington District of Fremont, and anyone is welcome to attend.

Resonate Church Turns Two

Read more: How to Go to Heaven According to the Bible

Bouquets to Arts 2012 at the deYoung

Waterlily Pond Floral Design Studio Interprets Chihuly

Ultramarine Stemmed Form With Orange
by Dave Chihuly

Bouquets to Art is a yearly event at the deYoung Museum in San Francisco, a five-day meeting of art and flowers to stimulate the senses. Floral arrangements created by 150 of the Bay Area's most prestigious florists and garden clubs interpret artworks from the permanent collection, and the show attracts more crowds than any other exhibition. The 2012 show honors the late John Buchanan, Director of the Fine Arts Museums of San Francisco. In tribute, the lobby offers two stunning metal sculptures sporting roses, orchids, hydrangeas, tulips and freesias standing atop art books and flyers for exhibitions he curated.

Tribute to John Buchanan
by Thierry Chantrel & Terry Gross

Bouquets to Art Review of Flower Artists

All the arrangements evidence creativity and attention to detail, but space limits mention of only a sampling. The previous year's amazing dog sculpture by Rhonda Stoffel of Grace Street Floral & Event Design echoes in a few pieces, like a Dalmatian by Orna Maymon and a leafy cat by Marsha Heckman, which lures Arthur Putnam's bronze sculpture, Puma on Guard. Regula Allenspach Weill of Regula's European Design interprets Mirrored Concorde by Ellsworth Kelly with a shimmery cube of reflective mylar, leaves and paper art.


 

Regula's European Design
Interprets Mirrored Concorde

Mirrored Concorde
by Ellsworth Kelly

           

Instead of curly willow, an abundance of succulents, callas and especially orchids dominate the bouquets this year. Perhaps due to the economy, many of the arrangements are simple, like the red shoes sprouting crimson and white blooms by Debbie Hitchcock of Lovey's Garden. Ron Morgan's black and white arrangement mimicking a Lichtenstein artwork is also minimalist. Hearts and Flowers of Tiburon present an interesting perspective of Wayne Thiebaud's Ponds and Streams with tight rows of flowers reflecting a bird's eye view of his landscape.

Marsha Heckman's Cat

Puma on Guard by Arthur Putnam

Bouquet by Debbie Hitchcock
Lovey's Garden

Arrangement by Yoshiko Williams
Tower Observation Level

There aren't as many oversized displays as submitted previously and surprisingly, some galleries don't have any floral displays at all, but the exhibit still won't disappoint. The gift store bustles with patrons buying floral art books and vases, obviously inspired to create bouquets of their own. Running from March 13 to 17, 2012, Bouquets to Art is a visual feast for aspiring and established floral designers alike.

Phyllis & Joe Brady's Interpretation
of Nathan Oliveira's Weaver

Ron Morgan's Interpretation of Lichtenstein

Modern Head #5
by Roy Lichtenstein

Bouquets to Arts at the deYoung

A few of the floral designers man the galleries during the exhibit, answering questions and making viewers feel welcome. Demonstration classes and lectures are also available in the Koret Auditorium for those interested in learning more.

Dalmatian Made of Baby's Breath
by Orna Maymon

Sacramento Indian by Charles Nahl, 186

Dark Colored Flowers Reflect Jaguar Bench
by Rhonda Stoffel, Grace Street Floral & Event Design

Jaguar Bench by Judy McKie

 

Hearts & Flowers of Tiburon Interpret Thiebaud's Landscape

Ponds and Streams
by Wayne Thiebaud, 2001

$25 - External iPhone 4/4S Battery Case with Free Shipping ($99 value)

Source:

bouquetstoart.famsf.org

"I Capture The Castle" Book Review

I Capture the Castle by Dodie Smith

I Capture the Castle by Dodie Smith is a novel written in diary form by the main character, seventeen-year-old Cassandra Mortmain. The book and her family are set in an interesting locale, a crumbling medieval castle in England. Though the book was written during the 1940's, it curiously lacks any mention of World War II.


I Capture the Castle by Dodie Smith

The family is on the road to destitution due to Mr. Mortmain's severe case of writer's block. He had once authored a bestseller that brought him fame and prosperity, but for many years had been unable to write a sequel. They had hoped living in a castle would inspire him to write, but the years had gone by without him producing anything. The Mortmain's had sold off many of their possessions to survive, with the only thing left to sell Cassandra's beautiful older sister, Rose. Cassandra and Rose long for romance, and they finally get it when two American brothers move into the community.

The book shows that females are females, no matter the era. Girls can be quite competitive over beauty, possessions and men, but they are also absolutely loyal to those they genuinely love. Cassandra draws the unsuspecting Neil to swim in the moat while her true motive is to give Rose time alone with Simon. Later Cassandra becomes infatuated with her sister's fiance but does everything she can to suppress her feelings. Also, Cassandra's stepmother Topaz loves Mortmain so much she has gaping blind spots. Topaz is hopelessly taken for granted, but small encouragements make her glow, like when Mortmain protests her deliberately dowdy appearance when she wanted Rose to shine more brightly before prospective husbands.

Women will follow their hearts even if the path leads to dangerous places, like Topaz following her husband into poverty and Rose moving to the California desert with Neil. Cassandra in particular demonstrates classic women's intuition when she quickly sizes up people's character. She knows her father's writer's block is poised to break or become permanent, so she imprisons him in the castle dungeon to force him to write. Her insight on the imbibing vicar, Rose and Stephen further show her incisive understanding of human nature, especially with her witticisms attributed to the mannequin Miss Blossom.

The Mortmain girls are driven by what they want and respond strongly on an emotional level, like Cassandra's explosive feelings for her sister's beau and her inability to conquer them. After Rose runs away with Neil and Simon asks Cassandra to come to the States, her intuition tells her she is second best, borne out of Simon's longing for Rose. She knows a marriage to him would ultimately fail because the love isn't reciprocal, and he softly calls her a "wise young judge."

One complaint about the novel would be that Cassandra's description of the castle is sketchy, making it hard to envision. Beyond that, the novel is a classic story of romance and adventure from a girls' perspective, before the days of cell phones and the internet. The story touches the heart and is a good one to read sitting by a fire and sipping a cup of tea.

Read more book reviews:

• Clara and Mr. Tiffany by SusanVreeland
• The Art of Racing in the Rain by Garth Stein
• The Water Is Wide by Pat Conroy

Hawaii's Senate Passes SB 2089

Waikiki, photo by Lauren Grell

On Tuesday March 6, 2012, the Hawaii Senate passed bill SB 2089, the controversial measure relating to transient accommodations. The bill now moves to the House and if passed there, will be sent by July to Governor Abercrombie for his signature.

Hawaii SB 2089 Takes Aim at Off-Island Vacation Rental Owners

photo by Chloe C.

Without supporting evidence, the Senate believes "there are a sizeable number of owners who do not pay their required transient accommodations taxes and general excise taxes" and that "enforcement efforts may also be hampered" when an owner of a vacation rental lives off-island. Bill SB2089 HD1 assumes nonresident owners do not comply with tax requirements, but no studies were included to prove this assumption. The last audit performed by the Tax Department for the Hawaii Tourism Authority concluded on April 3, 2007 that "in general, those that rent transient accommodations are tax compliant" and the Department didn't believe there was substantial non-compliance with tax obligations.

Tellingly, the Hawaii Tourism Authority is not in agreement with the legislation, providing input February 2, 2012 that "Chapter 237D already provides for penalties for engaging or continuing in the business without registering as required by the law." Their suggestion is to provide consumer education rather than implement the drastic methods of SB 2089.

Such education could easily be transmitted by giving Notices to interested parties outlining State law for transient accommodations, including the collection and payment of General Excise and Transient Accommodations taxes, emergency contact information for visitors and other pertinent data. Notices could include a Department of Taxation web page where all requirements and the means to comply are described, and every escrow could be required to give the Notices to buyers. This simple solution would result in every owner of Hawaiian real estate knowing the laws about General Excise Taxes, Transient Accommodations Taxes and State Tax Returns.

The flawed bill also requires nonresident owners to hire property managers, imposing red tape not required of those blessed to actually live in Hawaii. The Attorney General of Hawaii weighed in against SB 2089, stating that the Commerce Clause, the Equal Protection Clause, and the Privileges and Immunities Clause of the United States Constitution "generally prohibit discrimination against nonresidents or discrimination in favor of  'in state' residents."

Vacation Rentals By Owner in Hawaii


The amended bill indicates an assumption that professional real estate managers are necessary for consumer protections, dismissing the testimony of hundreds of vacation rental owners regarding the poor service and high fees demanded by these same managers. Many owners operate successfully using a team of housekeepers, repairmen and local folks to meet the need at a fraction of the cost.

The bill requires advertisements to include a local contact, but visitors may be confused by this insertion, as it applies only after they have arrived in Hawaii. Nonresident owners of condominium hotel units would be even further restricted by a requirement to employ only a condominium hotel operator to manage their units. Thus, one subsection of nonresident owners would be treated differently from the rest, and unnecessarily limited in their freedom to choose a local manager.

An exemption is proposed for property owners who obtain an annual tax clearance from the Department of Taxation, but the bill does not establish the criteria for receiving the tax clearance. The Tax Department would most likely be buried under requests and unable to process them all, causing delays and noncompliance. The Tax Department typically takes up to two months to provide tax identification numbers, so one can reasonably expect to see this added burden cause even more delays.

One of the requirements for the exemption involves filing Federal Form 990, but the form is labeled "Return of Organization Exempt From Income Tax." The legislature needs to clarify this and what the "certain nongovernmental entities" are which would impose themselves between the Department of Taxation and taxpayers. Also, the fines for non-compliance of any part of the bill are not laid out. Proponents suggested $1,000 per day, a punishment that surely doesn't fit the crime.

Napili Coast of Kauai; photo by Cassi Klipsch

SB 2089 and HB 1707 
    

Real estate property managers are a special interest group obviously looking for preferential treatment through SB 2089. Not one has been able to provide support for their numbers in the tens of millions of dollars of lost tax revenue to Hawaii from supposed "deadbeat" owners, yet they have the ear of the State Legislature. Interestingly, Don Brattin, a vacation rental homeowner, included in his testimony on a similar bill in the House a copy of an e-mail he managed to acquire written by Pat Sullivan, a Lahaina real estate property manager and ardent supporter of the bills. Sullivan's e-mail reveals the true motive of the measure's supporters, and it is copied here:   

"From: Pat Sullivan

Sent: Thursday, January 26, 2012 1:56 PM

To: [Recipients are void to protect them]

Subject: FW: Housing Committee Result - Bill HB 1706

"I didn’t have time yesterday to provide written testimony but they passed the initial Bill with a complete affirmative vote from the House...The Bill will require all mainland owners who rent their homes or condos out to have a licensed Realtor on island...ie...Bayer...vinson...~er~dt...~~j5 way the State can make sure everyone is paying their GET and TAT... yee hahhhh...lll! But don’t tell anyone yet...let the Bill get passed! !...then we can  get some $$$...unless they find a cheap Broker who will represent them for cheap..."

SB 2089 and its companion bill in the House clearly discriminate on the basis of residency and will take away the most basic of individual property rights in favor of a few real estate property managers. Both bills deserve to be soundly defeated.

photo by Beth Woods

Sources:

http://www.capitol.hawaii.gov/

http://www.homeaway.com/

Read more:

• The Case Against Hawaii's SB 2089
• The Case Against Hawaii's HB 1707
• Best Place to Own a Second Home in Hawaii

Home Improvement Tips for Later Resale

Home Improvements That Pay Off
photo by Renee V.

Some home renovations simply don't pay off when it is time to sell, so it makes sense to avoid them and invest in others. The location of a home will always be the primary determinant of price, but homeowners can increase it with curb appeal and specific upgrades.

Home Improvements Not Worth the Cost

Wall-to-wall carpeting will not add value to a home because floor covering is a personal choice, and many buyers prefer to choose their own carpet. Hardwood floors and porcelain tile are today's hottest trends, and neutral colors will please a greater range of buyers. If a homeowner doesn't intend to live in his house for the long-term, he may want to forgo turning a bedroom into an office. The square footage of his house will be the same, but a three-bedroom house would list for a lower price than a four-bedroom.

For expensive surfaces in a home, such as granite, stay away from gaudy colors and patterns as they detract most buyers. An investor in a foreclosure in Sunol, California had chosen pink granite when he renovated the kitchen, a pretty expensive undertaking. However, the buyer replaced it as soon as his family moved in. Black granites are very popular, and a better choice.

For the exterior, concrete patios are expensive to lay, often crack, and add nothing to the price of a home. And although sports enthusiasts may want to install a pool, tennis or basketball court, these amenities take up large amounts of the yard, and the pool is high maintenance. Most buyers prefer green grass.
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Best Home Improvements

Replacing leaky windows with energy efficient, dual paned ones is one of the best improvements a homeowner can make. Roughly eighty percent of the cost will be returned at the time of sale and for kitchen and bathroom remodels, the return is just as high. Replacing exterior siding will make a house look new, and even adding a deck will seem to give the house more square footage with an outdoor room.

Beyond floor space, well thought out landscaping gives great curb appeal, and low maintenance native plants are the most economical to buy. A few well placed flowers, fruit or ornamental trees, and especially vines draping over fences will brighten a home.

One family with two small children decided they could not purchase a house without a family room in addition to a living room, but the house they chose was only 1,187 square feet and had no family room. What made them change their minds? The seller had artfully landscaped his backyard with a flagstone patio, deck and arbor supporting grape vines and wisteria, creating an outdoor room the buyers were happy to have instead of the family room.

Although location is essential, targeted home remodeling will later help sell a home, even those that are distressed properties.

Sources:

"Home Upgrades That Don't Pay Off," October 2010, Dave & Carol Nishihara, Nishihara's Real Estate Update, Volume XVII, Issue IX

"Five Home Renovations That Pay Off," October 15, 2009, Joanne Cleaver, www.moneywatch.bnet.com

"6 Home Renovations With Major Payoffs," March 28, 2008, Sonya Stinson, www.finance.yahoo.com